NEW CEO SURVEY BY YALE SCHOOL OF MANAGEMENT AND THE GALLUP
ORGANIZATION REVEALS THAT "SERIAL ACQUIRER" CEOs ARE DRIVEN
BY EGO RATHER THAN BUSINESS OPPORTUNITIES:

Survey Also Shows That Many CEOs Feel Their Board Members Do Not Understand
Their Firm’s Business

For Immediate Release:

(New Haven) June 10, 2002 -- A new survey of chief executive officers of many of the nation's largest corporations conducted by the Yale School of Management and The Gallup Organization has just been released.

Among the survey’s findings was that those CEOs who fail to invest in their existing
infrastructure in favor of frequent acquisitions tend to be more likely to feel that great leaders are born that way. However, most CEOs believe that great leadership is developed over time.

Surprisingly, the survey found that as many as a quarter of the polled top executives feel that their boards do not understand the firms they are overseeing. In addition, the CEOs stated that they trusted the integrity of their own top management more than the competence of their top management. Also, these CEOs are twice as likely to be planning major investments in their staffing than in their technology in the coming year. While confident in their own firm's prospects in the coming year, few are confident in the nation's energy, communications, and healthcare industries.

Jeffrey Sonnenfeld, Associate Dean of the Yale School of Management commented, "The motives of the once admired and now widely discredited "serial acquirers" are revealed in this survey. Rather than driven by business opportunities or superior strategic vision, the CEOs who would rather build their empires through acquisitions rather than through investment in their current businesses seem to be driven by hubris. It is also stunning to see how many CEOs lack confidence in their boards, financial reporting, and even their own management teams. This seems to be an era for many CEOs to rethink their reliance upon their immediate associates."

The survey of 130 prominent chief executives of the nation's 1000 largest firms was completed the last two weeks of April 2002 through a new partnership between the Yale School of Management's Chief Executive Leadership Institute and The Gallup Organization. A report is attached.

For additional information about this research, please contact Jeffrey Sonnenfeld at
203-432-5955; jeffrey.sonnenfeld@yale.edu.

View Yale/Gallup CEO Survey Report